The Ministry of Industry (Kemenperin) is accelerating the equitable development and distribution of industry across Indonesia through a draft ministerial regulation on Specific Industrial Zones (KIT). As part of this initiative, the Directorate General of Industrial Resilience, Regional Development, and International Access (KPAII) recently held a public consultation in Batam to gather input on the regulation, which aligns with Government Regulation No. 20/2024 on Industrial Zoning. The draft aims to accommodate industrial zones with special characteristics, such as limited land or thematic development needs, and provides clearer direction for zones under 50 hectares in size. It also serves as a derivative regulation under the National Industrial Development Master Plan (RIPIN), promoting industrial clusters including Special Economic Zones (KEK) and Free Trade Zones (KPBPB).
KPAII Director General Tri Supondy emphasized the strategic role of industrial zoning in national industrial growth, with non-oil and gas manufacturing maintaining stable growth of 4–5% over the past five years and contributing over 16% to GDP. As of May 2025, 170 industrial zone companies have secured licenses covering nearly 95,000 hectares with a 59.5% occupancy rate. The draft regulation also opens the door for industrial zones established before 2015 to gain legal recognition. Business leaders, including those from KADIN and the Indonesian Industrial Estate Association (HKI), praised the policy's flexibility, particularly for areas like Batam where limited land and strong connectivity with Singapore and Malaysia make small-scale industrial zones under 50 hectares both necessary and strategic for SME investment growth.
